California Skilled and Trained Workforce- Do You Understand the Requirements? 

(Below is a synopsis of California’s Skilled and Trained Workforce requirements by long time ABC NorCal member attorney Deborah Wilder, president of CCMI – Contractor Compliance Monitoring Inc.).

California Skilled and Trained Workforce still creates havoc for many employers. While there are some amendments in the works by the California legislature, these basic requirements still apply: 

Two Parts to STW:

Part 1: All workers employed on the project must be an apprentice, a journeyman who is a graduate of an apprenticeship program (DAS approved program within CA or DOL approved program out of State) OR a journeyman with equivalent experience

Impact: no new hires or those with limited experience in construction on the project.

Part 2: Of the journeyman employed on the project, 60% MUST be graduates of an apprenticeship program (DAS approved program within CA or DOL approved program out of State).

30% for the following trades: Acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher. 60% for all other trades.

Exceptions to STW:

• If a subcontractor is performing less than ½ of 1% of the total contract price
• Workers performed a total of less than 10 hours of work per month
• Apprenticeship Program created after 2014 (some limitations)

Challenges: Both union and open shop contracts struggle to meet these numbers. Most apprenticeship programs are operated by a union. So open shop contractors have less opportunity to enroll their own workers in these programs. When companies become union signatory, their respective workforce is typically grandfathered in as journeymen so these journeymen do not have graduation cards from the apprenticeship program.

The Awarding Agency has the obligation to report non-compliant contractors to the DIR. The DIR can then take up to 18 months after the completion of the project to complete its investigation and issue penalties. While penalties currently max out a $5,000 per month, the DIR is consistently reducing those penalties (but not waiving them) if the contractor can show it has made a genuine effort to recruit graduates of apprenticeship programs and has been unsuccessful.

Click HERE for Skilled and Trained Workforce Requirements and FAQs from DIR

An Inherent Danger in the Poverty Defense to a PAGA Representative or Wage and Hour Class Action

BY: David M. Lester

Plaintiff attorneys have deluged the courts with wage and hour class actions and PAGA lawsuits. The first question an employee advocate asks of their potential client is, “can I see a pay stub?” Instead of agreeing to represent employees for their harassment or wrongful termination claim, they convince the disgruntled ex-employee to act as a representative for a PAGA or class action for improper wage and hour practices. 

This practice has blossomed into a cottage industry in which plaintiff attorneys are more focused on quick expensive settlements rather than drawn out litigation. Because of the potential stacking of penalties and the difficulty of maintaining compliant policies and practices, employers are faced with claims of multi-million dollar potential liability. As a result, many employers claim at mediation that these astronomical liability claims would put them out of business. However, the parties typically reach resolution at an unpalatable figure that allows the company to continue in business. 

On occasion a business takes the position that it would be easier to file for bankruptcy protection than agree to a crippling settlement. At first blush this may appear like a good idea because the employee’s attorney and their client can stand in the back of the line with all the other unsecured creditors and receive either pennies on the dollar or nothing at all. The problem is Labor Code section 558.1 which explicitly targets owners, directors, officers, or managing agents. 

The first published California case to address how this law is to be applied was Usher v. White, 64 Cal. App. 5^th 883 (2021), where the court found an owner not personally liable. The court set forth a test that to be personally liable, one must be personally involved in the violation of the Labor Code, or alternatively, must have sufficient participation in activity of the employer, like supervising those responsible for the alleged violation of the Labor Code. This case dealt with service technicians who were categorized as independent contractors. Because the owner was not consulted in the reclassification, nor did she provide any guidance regarding reclassification, was not involved in hiring, and did not create, draft, or contribute to independent contractor agreement, she was held not personally liable.

The next court to address this issue came to a different conclusion. In Espinosa v. Hepta Run, Inc., 74 Cal. App. 5^th 44 (2022), the court found the owner liable. The court acknowledged that just being an owner alone is not sufficient to create individual liability. The owner claimed he was not involved in the daily operation (with which the trial court did not agree), and the owner claimed he was not involved in the creation of policies. The court found the mere approval of a policy that violates the Labor Code is sufficient for owner liability. The court concluded that an owner must engage in some affirmative act beyond the status of being an owner to be liable. The affirmative act does not require being involved in day-to-day operations of the company, nor does it require the owner to be the author of the challenged employment policies. Rather, the owner must have some oversight of the company’s operations or some influence on corporate policies that results in Labor Code violations. Thus, absentee owners may not be held personally liable. 

On the other hand, if an owner is involved in the day-to-day operations and makes decisions either implementing or approving employment policies, the owner can be held personally liable. In short, the more involved an owner is in a business, the more likely such an owner could have personal liability. The idea behind Labor Code section 558.1 is to prevent employers from shuttering a business, failing to pay employees what they are owed, and starting a new business. Accordingly, plunging a business into bankruptcy might not resolve the problem for a small business.  

Another tactic open to business owners is to challenge the appropriateness of a private right of action under Labor Code section 558.1. While there is some question about whether such a claim must be brought by the government rather than an individual employee, courts have not yet opined on this potential defense. However, given recent California court decisions, the likelihood of this defense prevailing is unlikely.



Clients with questions regarding this post may reach out to the author or their usual employment law counsel at AALRR.

Cal/OSHA Reminds Employers to Protect Outdoor Workers from Heat Illness during Period of High Heat

Employers in California must take steps to protect outdoor workers from heat illness by providing water, rest, shade and training. When working in these hotter conditions for the first time this year, workers must be closely observed for any signs of heat illness.

Cal/OSHA’s heat illness prevention standard applies to all outdoor worksites. To prevent heat illness, the law requires employers to provide outdoor workers fresh water, access to shade at 80 degrees and, whenever requested by a worker, cool-down rest breaks in addition to regular breaks. Employers must also maintain a written prevention plan with effective training for supervisors to recognize the common signs and symptoms of heat illness, and what to do in case of an emergency.

In certain industries, when the temperature at outdoor worksites reaches or exceeds 95 degrees, Cal/OSHA’s standard requires additional protections. The industries with additional high-heat requirements are agriculture, construction, landscaping, oil and gas extraction and transportation of agricultural products, construction materials or other heavy materials. High-heat procedures include ensuring employees are observed regularly for signs of heat illness and establishing effective communication methods so workers can contact a supervisor when needed.

Employers with outdoor workers in all industries must take the following steps to prevent heat illness:

• Plan – Develop and implement an effective written heat illness prevention plan that includes emergency response procedures.
• Training – Train all employees and supervisors on heat illness prevention.
• Water – Provide drinking water that is fresh, pure, suitably cool and free of charge so that each worker can drink at least 1 quart per hour, and encourage workers to do so.
• Rest – Encourage workers to take a cool-down rest in the shade for at least five minutes when they feel the need to do so to protect themselves from overheating. Workers should not wait until they feel sick to cool down.
• Shade – Provide proper shade when temperatures exceed 80 degrees. Workers have the right to request and be provided shade to cool off at any time.

Cal/OSHA’s Heat Illness Prevention special emphasis program includes enforcement of the heat regulation as well as multilingual outreach and training programs for California’s employers and workers. Details on heat illness prevention requirements and training materials are available online on Cal/OSHA’s Heat Illness Prevention web page and the 99calor.org informational website. A Heat Illness Prevention online tool is also available on Cal/OSHA’s website.

Cal/OSHA helps protect workers from health and safety hazards on the job in almost every workplace in California. Employers who have questions or need assistance with workplace health and safety programs can call Cal/OSHA’s Consultation Services Branch at 800-963-9424.

Workers who have questions about heat illness prevention can call 833-579-0927 to speak with a live Cal/OSHA representative between the hours of 9 a.m. and 7 p.m. Complaints about workplace safety and health hazards can be filed confidentially with Cal/OSHA district offices. 

Best Practices for Responding to Personnel Record Requests

Updated May 1, 2023 by attorney Brian D. Bertossa law firm Cook Brown LLP

Under California’s Labor Code, current and former employees have the right to inspect and receive their personnel files. We have previously provided general best practices for responding to such requests. This update will address an issue which frequently arises when employers receive requests for personnel records.

Employee Right to Personnel Files

Labor Code Section 1198.5 provides that current and former employees (or a representative) have the right to inspect and receive a copy of the personnel files and records that relate to the employee’s performance or to any grievance concerning the employee. Upon a written request from a current or former employee or a representative, the employer shall provide a copy of the personnel records at a charge not to exceed the actual cost of reproduction not less than 30 calendar days from the date the employer receives the request.

However, Section 1198.5(e) provides: “The employer may take reasonable steps to verify the identity of a current or former employee or his or her authorized representative. For purposes of this section, “representative” means a person authorized in writing by the employee to inspect, or receive a copy of his or her personnel records.”

Given California law protecting employee privacy, it is not only reasonable, but best practice for employers to confirm that the employee has provided authorization before providing an attorney with records, which may potentially contain a wealth of confidential information regarding the employee – for example, address, salary, SSN. Producing such confidential information of an employee without authorization by the employee may expose the employer to a variety of claims, including violation of the California Constitution’s right of privacy.

Employee Authorization

Many requests for the personnel records of employees are not sent by the employee, but instead are sent by letter to the employer from an attorney claiming to represent the employee. However, the attorney sending the letter does not always provide along with the letter any authorization signed by the employee authorizing the attorney to inspect or a receive a copy of the employee’s records.

When no authorization accompanies a records request sent by an attorney on behalf of a current or former employee, the employer is justified in taking “reasonable steps” under Section 1198.5(e) prior to producing records to the requesting attorney to verify that the employee has in fact authorized the attorney to request and receive records on the employee’s behalf. A first reasonable step is for the employer to inform the attorney that the employer will not produce employee personnel records until or unless the requesting attorney provides an authorization signed by the employee which allows the employer to verify the identity of the current or former employee. If the attorney responds by providing a wet ink signature of the employee on an authorization, the employer can compare the signature to wet ink signatures of the employee contained in the employee personnel file or other documents in the employer’s possession and complete its verification.

Authenticating Electronic Signatures

However, frequently the requesting attorney responds not with an authorization containing a wet ink signature of the employee, but instead with some form of an electronic signature alleged to be that of the employee, which signature may be alleged to be a copy of the employee’s actual signature or be merely a computer-generated generic “signature” of the employee that bears no resemblance to the employee’s actual signature. The submission of an alleged electronic signature raises a question of whether the employee has actually provided an authentic authorization for the attorney to obtain records on the employee’s behalf.

California courts of appeal have examined the question of when an alleged electronic signature of an employee will be deemed authenticated under California Civil Code section 1633.9, which governs authorization of electronic signatures. Section 1633.9 provides: “(a) An electronic record or electronic signature is attributable to a person if it was the act of the person. The act of the person may be shown in any manner, including a showing of the efficacy of any security procedure applied to determine the person to which the electronic record or electronic signature was attributable. (b) The effect of an electronic record or electronic signature attributed to a person under subdivision (a) is determined from the context and surrounding circumstances at the time of its creation, execution, or adoption, including the parties’ agreement, if any, and otherwise as provided by law.”

In Bannister v. Marinidence Opco, LLC (2021) 64 Cal.App.5th 541, a California court of appeal rejected an employer’s attempt to establish that an employee’s electronic signature on an arbitration agreement bound the employee, finding “. . . a party may establish that the electronic signature was “the act of the person” by presenting evidence that a unique login and password known only to that person was required to affix the electronic signature along with evidence detailing the procedures the person had to follow to electronically sign the document and the accompanying security precautions.”

In a similar case, Ruiz v. Moss Bros. Auto Group, Inc. (2014) 232 Cal.App.4th 836, an employer sought to enforce an arbitration agreement, which contained an electronic signature of the employee, but the employee claimed not to recall making the electronic signature. The court of appeal found the evidence submitted by the employer to authenticate the employee’s electronic signature inadequate. The Court found that the mere fact that the agreement contained an electronic signature in the name of the employee and a date and time stamp for the signature “was insufficient to support a finding that the electronic signature was, in fact, ‘the act of’” the employee.

Navigating the Complexities of Electronic Signatures

Such cases suggest an employer would be reasonable not to accept as valid an authorization provided by an attorney claiming to represent an employee which contains an alleged electronic signature of the employee, but which provides no “evidence detailing the procedures the person had to follow to electronically sign the document and the accompanying security precautions.” Even if the attorney attempted to provide such evidence without speaking directly to the employee regarding the circumstances surrounding the execution of the alleged electronic signature, the employer may still be unable without more to confirm the acts the attorney alleged were taken by the employee to authenticate a signature were in fact taken by the employee as this is not a situation where the employer was in control of obtaining the employee signature, but rather the employer is merely presented with an alleged electronic signature of the employee by the attorney.

While there may be circumstances under which an electronic signature may verify the identity of a current or former employee for purposes of authenticating an authorization for an attorney to obtain personnel records of the employee – for example, if the employee verbally confirms to the employer the authenticity of the electronic signature – there are other situations where simply providing a purported electronic signature may not be adequate to permit the employer to verify the identity of the employee.

Employers must navigate the competing obligations of providing personnel records under Labor Code section 1198.5 against the obligation to protect employee privacy rights by protecting confidential information from unauthorized disclosure. Requiring a written authorization signed by the employee when the request for records is made by an attorney on behalf of an employee and carefully examining the validity of the signature on any authentication provided by an attorney claiming to have the employee’s authorization to receive such records is an important and reasonable step under Labor Code section 1198.5(e) to meet both obligations.

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